Drug delivery firm reports 79% increase in revenues.

2003 AUG 29 - (NewsRx.com & NewsRx.net) -- Cima Labs, Inc., (CIMA) reported record results for the second quarter ended June 30, 2003.

Highlights include the following:

1) Revenues increased 79% year-over-year to $18.3 million, from $10.2 million in the second quarter of 2002, and rose 10%sequentially from $16.7 million in the first quarter of 2003.

2) Operating income was $4.2 million (23.2% of revenue), a 117%increase from the second quarter of 2002. In addition, CIMA's operating income increased 10% sequentially from $3.9 million(23.2% of revenues) in the first quarter of 2003, despite higher-than-anticipated legal costs associated with a patent defense claim.

3) Other income, principally investment income, declined approximately 56% year-over-year to $849,000 in the second quarter of 2003 due to lower reinvestment rates.

4) Net income was $3.7 million, or $0.25 per share on a diluted basis, compared with second-quarter 2002 net income of $4.2million, or $0.28 per diluted share. The year-over-year decline in net income reflects CIMA recording approximately$1.4 million in income tax provisions during the quarter, compared to a small tax benefit recorded in the second quarter of 2002.

"This was another very good quarter for CIMA," said Steven B. Ratoff, chairman and interim CEO. "CIMA operated at full capacity during the second quarter, as our sales of Remeron SolTabs and Alavert to CIMA's partners remained strong. Higher absorption of fixed costs, together with a favorable manufacturing mix, resulted in substantially improved product gross margins. As a result, we hit the middle of our second-quarter guidance range for revenue and the top of the range for earnings. At the same time, we made excellent progress in our product development pipeline activities."